George CollierMost growing businesses hit the same point. The off-the-shelf tools stop fitting, the spreadsheets multiply, and someone says “we should hire a developer”. Sometimes that's right. Often it's the most expensive way to get the software you need.
If software is the product you sell, hire. If you're under about 15 staff, or need one system built and then left alone, buy off-the-shelf.
If you're a business of 15 or more that needs its systems built and improved every week, managed software costs about half a senior hire, starts within 30 days and includes a product manager, design and QA.
What a developer hire costs
A senior developer costs around $150,000£100,000€110,000 a year in salary, which is $12,500£8,300€9,200 a month. Recruiters usually charge about 20% of first-year salary, so add another $30,000£20,000€22,000 before they start. Then there's employer tax, pension, a laptop and their tools.
Then there's time. Recruiting takes a month or two, and good developers usually have a notice period of one to three months. Once they start, they need a few months to learn how your business works before they're building the right things quickly. It's normal for the first useful release to land four to six months after you decide to hire.
What one developer can't cover
The bigger issue is what one person can't do on their own:
- Nobody reviews their code or tests their work, so bugs reach your staff. Testing is a job, and it usually falls to whoever complains first.
- Someone has to turn “the quoting screen is a pain” into a clear spec. Without a product manager, that's either the developer or you.
- Holidays, sickness and resignations stop everything. When they leave, most of what they know about your systems leaves with them.
- If you're not technical, it's hard to tell whether a week was productive or whether the code will hold up in two years.
What managed software includes
Managed software is what we offer instead. For $6,000£4,500€5,300 a month, however many of your staff use it, you get a senior developer, a product manager, design and QA. We release every week, monitor everything and fix what breaks, and set your team up to use AI properly.
The first system is live within 30 days, and something new ships every week after that. There's no minimum term. You own the code and the data, and if you ever want to bring it in-house, the handover is free. The pricing has the details.
| Compared on | Hire a developer | Managed software |
|---|---|---|
| Monthly cost | $12,500£8,300€9,200 in salary alone | $6,000£4,500€5,300, flat |
| Upfront cost | Recruiter fee of about $30,000£20,000€22,000 | None |
| First release | Often 4 to 6 months | Within 30 days |
| Who you get | One developer | Developer, product manager, design and QA |
| Holidays and sickness | Work stops | The team covers it |
| Commitment | Employment contract | No minimum term |
| Who owns the code | You | You |
When hiring is the right call
I'd hire if any of these are true:
- Software is what you sell. A SaaS company needs engineers on the payroll, and probably more than one.
- You need several developers working full time, indefinitely. At that point an in-house team is worth the overhead.
- You already have a technical lead who can hire, review and manage developers. Most of the risks above go away.
Plenty of our clients will hire eventually. That's fine, and it's why the handover is free.
When off-the-shelf is the right call
Under about 15 staff, off-the-shelf software is usually cheaper than either option. If HubSpot, Xero and a scheduling tool cover how you work, use them and spend the money elsewhere.
Custom software earns its keep when your team spends hours every week working around tools that don't fit. Floor Authority is a good example: generic software couldn't handle flooring quantities, so the team did it by hand until they had a system built for it.
What about a one-off project?
A fixed-price project from an agency or freelancer gets a first version built. The catch is that most business systems need changes every week once staff start using them, and the people who built it have moved on. You end up paying for change requests one at a time, or hiring anyway.
If you're not sure which applies to you, the use cases show the systems we build most often, with what each one replaces.
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